A two-part group of senators has submitted legislation to the US Senate with the aim of reducing the perceived risk associated with El Salvador’s adoption of bitcoin (BTC) as a legal tender.
Salvador’s proposed Cryptocurrency Liability Act (ACES) aims to “reduce potential risks to the US financial system” such as money laundering and terrorist financing.
The bill was introduced by Senators James Rich and Bill Cassidy and signed by Bob Menendez. Senator Rich wrote in a statement Wednesday:
“El Salvador’s acceptance of bitcoin as a legal tender raises serious concerns about the economic stability and economic viability of a weak US trading partner in Central America.”
Senator Cassidy wrote that “recognizing bitcoin as the official currency opens the door to money laundering cartels and undermines US interests.”
If passed, the bill would give federal agencies 60 days to submit a report assessing some aspects of the Central American nation’s capabilities for cybersecurity and financial stability.
The first part of the report will consider how El Salvador drafted and adopted bitcoin legislation, how El Salvador will reduce the economic sustainability and cyber security risk of digital assets, whether it meets the requirements of the Financial Action Task Force on Money Laundering, the impact on individuals and businesses, and the impact that cryptocurrencies will have on the economy.
The next part of the report will describe the Internet infrastructure in El Salvador and assess the “degree of use of cryptocurrency” there, the money savings, the possibility of being hacked and the level of access to financing that disadvantaged or unbanked Salvadorans have.
Following the publication of these reports, the bill will provide action plans for the various parties in response to the results.
Salvadoran President Najib Bukele responded to the remarkable interference in his country by tweeting: “You have no jurisdiction over an independent and sovereign country. We are not your colony, your backyard or your front yard. ”
The El Salvadoran government passed a bitcoin law in June 2021, which made bitcoin a legal tender in the country and in turn forced companies to accept it as a payment method.
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The law has met with some opposition from local lawmakers and the International Monetary Fund, which on several occasions has called on President Bukele to repeal the bitcoin law by January 25 at market value.
